Correlation Between Nanxing Furniture and Dhc Software
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By analyzing existing cross correlation between Nanxing Furniture Machinery and Dhc Software Co, you can compare the effects of market volatilities on Nanxing Furniture and Dhc Software and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nanxing Furniture with a short position of Dhc Software. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nanxing Furniture and Dhc Software.
Diversification Opportunities for Nanxing Furniture and Dhc Software
0.84 | Correlation Coefficient |
Very poor diversification
The 3 months correlation between Nanxing and Dhc is 0.84. Overlapping area represents the amount of risk that can be diversified away by holding Nanxing Furniture Machinery and Dhc Software Co in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Dhc Software and Nanxing Furniture is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nanxing Furniture Machinery are associated (or correlated) with Dhc Software. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Dhc Software has no effect on the direction of Nanxing Furniture i.e., Nanxing Furniture and Dhc Software go up and down completely randomly.
Pair Corralation between Nanxing Furniture and Dhc Software
Assuming the 90 days trading horizon Nanxing Furniture is expected to generate 1.6 times less return on investment than Dhc Software. In addition to that, Nanxing Furniture is 1.0 times more volatile than Dhc Software Co. It trades about 0.17 of its total potential returns per unit of risk. Dhc Software Co is currently generating about 0.28 per unit of volatility. If you would invest 432.00 in Dhc Software Co on August 28, 2024 and sell it today you would earn a total of 365.00 from holding Dhc Software Co or generate 84.49% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Nanxing Furniture Machinery vs. Dhc Software Co
Performance |
| Timeline |
| Nanxing Furniture |
| Dhc Software |
Nanxing Furniture and Dhc Software Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nanxing Furniture and Dhc Software
The main advantage of trading using opposite Nanxing Furniture and Dhc Software positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nanxing Furniture position performs unexpectedly, Dhc Software can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Dhc Software will offset losses from the drop in Dhc Software's long position.| Nanxing Furniture vs. Dhc Software Co | Nanxing Furniture vs. Vanfund Urban Investment | Nanxing Furniture vs. China National Software | Nanxing Furniture vs. Chengdu Xingrong Investment |
| Dhc Software vs. Jiaozuo Wanfang Aluminum | Dhc Software vs. Sino Platinum Metals Co | Dhc Software vs. Tibet Huayu Mining | Dhc Software vs. Heilongjiang Transport Development |
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